In a potential landmark deal, the Qatar Investment Authority is reportedly in talks to invest in seven historic Egyptian hotels.
Qatar’s sovereign wealth fund is in serious discussions with The Sovereign Wealth Fund of Egypt (TSFE) to potentially invest in seven prestigious historic hotels in Egypt.
The significant investment plan, which could prove to be a milestone in the strengthening of bilateral ties between the two nations, was leaked by informed sources who requested anonymity from Reuters.
The two countries recently resumed diplomatic relations in 2021 after years of estrangement triggered by the 2017 blockade. Qatar Investment Authority (QIA) and other prominent businessmen from the Gulf state have invested heavily in the country since the political crisis came to an end with the signing of the Al Ula declaration.
While the names of the hotels remain undisclosed, insiders revealed that the QIA is contemplating acquiring up to 30 percent stake in these Egyptian assets. Neither party has publicly commented on the matter.
As of now, both the QIA, which holds an estimated $445 billion, and Egypt’s TSFE have refrained from making any public comments on this potential transaction.
Tides return to shore
The prospective hotel investment deal signals a positive shift in the economic and diplomatic interplay between Qatar and Egypt, offering potential benefits for both countries.
The investment talks come amidst a backdrop of revitalised diplomacy between Egypt and Qatar, which was marred by a prolonged dispute following the Arab Spring uprisings.
The relationship took a significant hit when the Qatari government expressed support for the pro-democracy protesters, which largely included members of the Muslim Brotherhood, a political faction that rose to power after the fall of Egyptian President Hosni Mubarak, but was later dethroned by a military coup in 2013.
However, the tides turned in 2021 when diplomatic relations were reinstated, driven largely by Saudi Arabia, a regional powerhouse.
A historic meeting occurred in August 2021, when Egyptian President Abdel Fattah al-Sisi and Qatari Amir Sheikh Tamim bin Hamad Al Thani met in Baghdad, marking their first encounter post the resolution of the dispute.
Egypt, with the highest population in the Arab world, is presently battling an economic crisis and a depreciating currency, which lost approximately half its value following Russia’s invasion of Ukraine. This led to a withdrawal of more than $20 billion by foreign investors from Egypt’s treasury markets.
Cairo is now relying on investments and assistance that Qatar and other Gulf countries pledged last year in order to ease a foreign exchange crisis.
In March 2022 that Qatar and Egypt had struck investment agreements worth a combined $5 billion in various industries.
“Since last year, there are regular visits to Doha and to Cairo and also there was
an agreement for $5 billion, $3 billion deposited in the Central Bank of Egypt
and $2 billion dollars for investment,” Egypt’s Finance Minister Mohamed Maait told Doha News in an exclusive interview during the Qatar Economic Forum 2022.
In an effort to alleviate the North African nation’s economic distress, Qatar’s finance minister last month reaffirmed the country’s commitment to infuse $5 billion into the struggling Egyptian economy, following through on the promise made in the previous year.